Apple Reverses Slump with 8% iPhone Sales Growth in China

Apple reversed a two-year sales decline in China with an 8% year-on-year increase in iPhone shipments in Q2 2025, driven by aggressive discounts on iPhone 16 models and strong performance during the 618 shopping festival. Despite this growth, Apple remains the third-largest smartphone vendor in China, trailing behind Huawei and Vivo, with Huawei benefiting from government subsidies and a resurgence post-sanctions. Apple expanded its market reach with the introduction of the lower-cost iPhone 16e, appealing to budget-conscious consumers amid a slowing Chinese economy and cautious spending on premium goods. While Apple’s iPhone sales surged, its wearable device business has experienced a decline, though it remains the global market leader, facing rising competition from Huawei and Xiaomi, who have posted significant growth. Jefferies analysts forecast a global smartphone volume decline through 2027 but note Apple's ability to leverage localized promotions and tariff-driven demand may help it sustain better-than-expected growth in China. Overall, Apple’s strategy of combining premium branding with targeted price cuts and trade-in incentives has helped it maintain momentum despite intense competition and geopolitical pressures in the Chinese market.